but if you use the 350 adapter it would place the 203 in the same position in relation to the 700 as it would have been on the 350, therefore it would have to be the same amount of spline engagement right?

The TH350 has a shorter stick out on the output shaft than a 700R4 does. Also the TH350/203 adapter is only 1" thick whereas the 700R4/208 is 3" thick so if you cut 2" off the output shaft and use the TH350/203 adapter you will have VERY LITTLE spline left. Trust me, i was going to do this years ago and after doing some research found out it isn't wise to do it that way.

I believe the spacer is actually made for swapping a th350 in the place of a 700R4. I ended up not using the spacer. I'm going with the ORD shaft. I talked with the guys at ORD and they said the newer flange style front CV shafts can have clearance issues with the 700R4 pan. The older yoke style CV shafts are supposed to work fine. This is all for an NP205 to 700R4. I don't know if it's true for an Np203 or not.

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